XXII Breach of Agreement and Power to Cancel

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– دﺪﻌﻟا ٥٠ رﺮﻜﻣ )ج( ﻰﻓ ١٨ ﺮﺒﻤﺴﯾد ﺔﻨﺳ٢٠٢١ ﺔﯿﻤﺳﺮﻟا ةﺪﯾﺮﺠﻟا

In the event no Commercial Production of Oil in regular shipments from any Development Block in the Development Lease within four (4) years from the date of commencement of Commercial Production for Oil in such Development Lease (or as may be extended by EGPC), such Development Block shall be considered relinquished, unless there is a Commercial Oil Discovery on the Development Lease based on Gas. Each Block in a Development Lease being partly within the radius of drainage of any producing well shall be considered as participating in the Commercial Production referred to above. Every four (4) years from the date of commencement of Oil Commercial Production, EGPC shall review the Development Blocks لوادتلا دنع اهب دتعي لا ةينورتكلإ ةروصin the Development Leases in respect of "New Exploration Area" for immediate relinquishment of any non-producing block or any block that does not participate in production (unless otherwise agreed by EGPC). CONTRACTOR shall submit to EUG all data, information and studies that have been made for any relinquished blocks within the Area, no later than thirty (30) days from EGPC’s approval date of any relinquishment. If, upon application by CONTRACTOR it is recognized by EGPC that Crude Oil is being drained from any Block under this Concession Agreement into a Development Block on an adjoining concession area held by CONTRACTOR, the Block being drained shall be considered as participating in the Commercial Production of the Development Block in question with the ensuing allocation of costs and production (calculated from the Effective Date or the date such drainage occurs, whichever is later) between the two concession areas. The allocation of such costs and production under each concession agreement shall be in the same portion that the recoverable reserves in the drained geological structure underlying each concession area bears to the total recoverable reserves of such structure underlying both concession areas. The production allocated to a concession area shall be priced according to the concession agreement covering that concession area.

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– دﺪﻌﻟا ٥٠ رﺮﻜﻣ )ج( ﻰﻓ ١٨ ﺮﺒﻤﺴﯾد ﺔﻨﺳ٢٠٢١ ﺔﯿﻤﺳﺮﻟا ةﺪﯾﺮﺠﻟا

In case of failure by the CONTRACTOR in this Agreement and the contractor in adjoining concession area to agree on the allocation of costs and/or production for such separate Development Leases under each concession area, such disagreement shall be resolved by expert determination, the expert to be agreed upon by the two contractors. EGPC shall have the right to interfere and induce the contractors to fully cooperate and resolve the drainage matter in expedient manner as per the expert decision, such that neither contractor shall be unjustifiably enriched. The cost of the expert shall in no event be recovered.

In case Gas is being drained from any Block under this Concession

Agreement into a Development Block on an adjoining concession area, EGPC and such adjoining area contractor shall agree on the allocation of costs and/or production under each concession area. (f) CONTRACTOR shall bear and pay all the costs and expenses required in carrying out all the operations under this Agreement but such costs and expenses shall not include any interest on investment. CONTRACTOR shall look only to the Crude Oil to which it is entitled under this Agreement to recover such costs and expenses. Such costs and expenses shall be recoverable as provided in Article VII. During the term of this Agreement and its renewal, the total production achieved in the conduct of such operations shall be divided between EGPC and CONTRACTOR in accordance with the provisions of Article VII. (g) (1) Unless otherwise provided, CONTRACTOR shall be subject to Egyptian income tax laws and shall comply with the requirements of such laws with respect to the filing of returns, the assessment of tax, and keeping and showing of books and records. لوادتلا دنع اهب دتعي لا ةينورتكلإ ةروص

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– دﺪﻌﻟا ٥٠ رﺮﻜﻣ )ج( ﻰﻓ ١٨ ﺮﺒﻤﺴﯾد ﺔﻨﺳ٢٠٢١ ﺔﯿﻤﺳﺮﻟا ةﺪﯾﺮﺠﻟا

(2) CONTRACTOR shall be liable to prepare the tax return, that only the tax authority shall be entitled to audit.

CONTRACTOR shall submit the tax return to EGPC twenty five (25) days prior to the due date of submitting thereof to the tax authority. EGPC shall have the right to review the tax return in order to accept the tax calculation therein. EGPC shall provide comments on such return within fifteen (15) days of the date of receiving the tax return from

CONTRACTOR. In any case CONTRACTOR shall be responsible for submitting the tax return to the tax authority within the due date.

(3) CONTRACTOR's annual income for Egyptian income tax purposes under this Agreement shall be an amount calculated as follows:

The total of the sums received by CONTRACTOR from the sale or other disposition of all Crude Oil acquired by CONTRACTOR pursuant to Article VII (a) and (b); لوادتلا دنع اهب دتعي لا ةينورتكلإ ةروصReduced by: (i) The costs and expenses of CONTRACTOR; (ii) The value as determined according to Article VII (c), of EGPC's share of the Excess Cost Recovery Crude Oil repaid to EGPC in cash or in kind, if any, Plus: An amount equal to CONTRACTOR's Egyptian income taxes grossed up in the manner shown in Article VI of Annex "E".

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– دﺪﻌﻟا ٥٠ رﺮﻜﻣ )ج( ﻰﻓ ١٨ ﺮﺒﻤﺴﯾد ﺔﻨﺳ٢٠٢١ ﺔﯿﻤﺳﺮﻟا ةﺪﯾﺮﺠﻟا

For purposes of above tax deductions in any Tax Year, Article

VII (a) shall apply only in respect of classification of costs

and expenses and rates of amortization, without regard to the

percentage limitation referred to in the first paragraph of

Article VII (a) (1). All costs and expenses of CONTRACTOR

in conducting the operations under this Agreement which are

not controlled by Article VII (a) as above qualified shall be

deductible in accordance with the provisions of the Egyptian

Income Tax Law.

(4) EGPC shall assume, pay and discharge, in the name and on

behalf of CONTRACTOR, CONTRACTOR's Egyptian

income tax out of EGPC's share of the Oil produced and saved

and not used in operations under Article VII. All taxes paid by

EGPC in the name and on behalf of CONTRACTOR shall be

considered income to CONTRACTOR.

(5) EGPC shall furnish to CONTRACTOR the proper official

receipts evidencing the payment of CONTRACTOR's

Egyptian income tax for each Tax Year within ninety (90)

days following the receipt by EGPC of CONTRACTOR's tax

declaration for the preceding Tax Year. Such receipts shall be

issued by the proper Tax Authorities and shall state the

amount and other particulars customary for such receipts. لوادتلا دنع اهب دتعي لا ةينورتكلإ ةروص